Browsing by Author "Volta, Nicola"

Now showing 1 - 4 of 4
  • Thumbnail Image
    ItemOpen Access
    A cost-efficiency analysis of European air navigation service providers
    (Elsevier, 2018-03-11) Dempsey-Brench, Zara; Volta, Nicola
    Air Navigation Service Providers (ANSPs) as the third major component of the aviation industry have been less of a focus in research than their airline and airport counterparts. In this paper we analyse European ANSPs cost structures using a stochastic frontier analysis approach within a Bayesian estimation framework in order to incorporate regularity conditions. Our results show that ownership is not directly impacting neither the ANSPs cost structures nor their cost efficiencies and that the European ANSPs are operating on the increasing return to scale part of the technology, hence supporting the choice of ANSPs agglomeration.
  • Thumbnail Image
    ItemOpen Access
    The multi-airline p-hub median problem applied to the African aviation market
    (Elsevier, 2017-12-11) Adler, Nicole; Njoya, Eric Tchouamou; Volta, Nicola
    Despite growth in research on air transport in Africa in recent years, little is known about the adequacy of the infrastructure to sustain potential future air traffic expansion. The continent has experienced growth in domestic, intra- and inter-continental air traffic services over the past two decades that we project will continue over the medium term. Applying a gravity model in which corruption, conflict, common language and land-locked indices contribute to the demand estimation, we forecast annual intra-African growth of 8.1% up to 2030. As witnessed in established markets, deregulation will likely result in hub-spoke network designs in order to accommodate demand efficiently if mobility and access is to be encouraged. In this research, we modify the p-hub median problem in order to identify multiple, economically viable, hub-spoke networks that would adequately serve the intra- and inter-continental demand for air transport. Aside from current hubs, namely Cairo (Egypt), Addis Ababa (Ethiopia) and Johannesburg (South Africa), future hubs could include airports in the North that serve European-African flows, such as Algiers, and Nigeria in the West due to its relatively large population and wealth. By 2030, we also find that demand is sufficient to justify an additional hub in central Sub-Saharan Africa, such as Lusaka (Zambia). However, this would be dependent on the implementation of liberalisation policies as set out in the Yamoussoukro Decision.
  • Thumbnail Image
    ItemOpen Access
    Price asymmetries in European airfares
    (Elsevier, 2018-03-03) Scotti, Davide; Volta, Nicola
    This research analyses airlines' pricing decisions in response to changes in the market conditions. We estimate the effects of jet fuel price changes on European airfares at airline/route level by discriminating on the grounds of supplied capacity and markets’ competitive structure. Our results show that airlines tend to adjust fares asymmetrically following a “rocket and feather” behaviour. The asymmetric pricing is marked in periods of decreasing capacity when the increases of fuel price are passed at a higher degree than fuel cost savings. In contrast, when capacity increases the asymmetry is lowered. Moreover, we show that highly competitive markets are characterized by a lower price asymmetry compared to low competition markets. Finally, our results show that airline price asymmetry reaches its maximum when capacity is reduced and competition is low.
  • Thumbnail Image
    ItemOpen Access
    Profitability change in the global airline industry
    (Elsevier, 2017-03-31) Scotti, Davide; Volta, Nicola
    This paper studies airline profitability change computed through a Bayesian estimation of a cost function. The stochastic frontier is applied to a dataset including the largest worldwide airlines in the period 1983–2010. We show that productivity change is mainly driven by technical change becoming continuously positive from early 1990s. Furthermore, in the last decade profitability change is mainly driven by input price change which exhibits a similar pattern to output price change. In presence of productivity growth, the output price increase is lower than the input price increase suggesting that part of productivity gains are transferred from airlines to consumers